Economics of Good and Evil : The Quest for Economic Meaning from Gilgamesh to Wall Street Hardback
Tomas Sedlacek has shaken the study of economics as few ever have.
Named one of the "Young Guns" and one of the "five hot minds in economics" by the Yale Economic Review, he serves on the National Economic Council in Prague, where his provocative writing has achieved bestseller status.
How has he done it? By arguing a simple, almost heretical proposition: economics is ultimately about good and evil.
In The Economics of Good and Evil, Sedlacek radically rethinks his field, challenging our assumptions about the world.
Economics is touted as a science, a value-free mathematical inquiry, he writes, but it's actually a cultural phenomenon, a product of our civilization.
It began within philosophy-Adam Smith himself not only wrote The Wealth of Nations, but also The Theory of Moral Sentiments-and economics, as Sedlacek shows, is woven out of history, myth, religion, and ethics. "Even the most sophisticated mathematical model," Sedlacek writes, "is, de facto, a story, a parable, our effort to (rationally) grasp the world around us." Economics not only describes the world, but establishes normative standards, identifying ideal conditions. Science, he claims, is a system of beliefs to which we are committed.
To grasp the beliefs underlying economics, he breaks out of the field's confines with a tour de force exploration of economic thinking, broadly defined, over the millennia.
He ranges from the epic of Gilgamesh and the Old Testament to the emergence of Christianity, from Descartes and Adam Smith to the consumerism in Fight Club.
Throughout, he asks searching meta-economic questions: What is the meaning and the point of economics?
Can we do ethically all that we can do technically? Does it pay to be good? Placing the wisdom of philosophers and poets over strict mathematical models of human behavior, Sedlacek's groundbreaking work promises to change the way we calculate economic value.
- Format: Hardback
- Pages: 376 pages, 15 b/w
- Publisher: Oxford University Press Inc
- Publication Date: 16/06/2011
- Category: Economic theory & philosophy
- ISBN: 9780199767205
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Review by RandyStafford
Czech economist Sedlacek argues that his discipline needs to step away from its mathematical myths and look at the more honestly labeled myths of tradition, the insights of religion, and the questions of philosophers. In this book, it is Western myth, religion, and philosphy he examines from the The Epic Of Gilgamesh to Adam Smith. Economic thought, he argues, didn't begin with Smith. The Scottish philosopher, rather, was the end of an explicitly ethical look at economic matters. After him came the notion of homo economicus, that mythical beast of perfect rationality and obsessive seeker of that conveniently and situationally redefined noun "utility".The "good and evil" of the title do not refer to the gamut of vice and virtue but some specific questions: Is the need for physical labor a curse or a blessing of the world? Should physical pleasures be spurned for adherence to a set of rules or the life of the mind? Is life simply about maximizing utility or maximizing good? What is "good", exactly, in an economic context? Does the world really run on self-interest, sometimes called vice? How rational is man in making economic decisions?Sedlacek starts out with Gilgamesh's story and its revolt against the idea of man as just an economic input via labor and the beginnings of that wonderful and terrible interdependence urban life created. Old Testament thought is next with particular stress given to the Jewish idea of perfecting the world, its rejection of asceticism, and the importance of a "Sabbath economy" - a sacred space in time where the search for productivity and utility maximization stops. Greek contributions are next with looks at the poles of Platonic idealism, Aristotelian engagement with the world and the importance he attached to the "golden mean" of moderation in all things, the hedonism of the Epicureans which foreshadowed modern economic thought, and particular emphasis on Smith's affinity for Stoic thought with its idea of good - adherence to some set of rules - as its own reward, and the first explicitly economic text we have: Xenophon's On Revenues. Christianity is examined next, both the New Testament and the thought of Thomas Aquinas, with a reminder that an economic metaphor lies at the heart of that religion - the redemption, forgiveness of a debt. We take a detour to look at Descartes' influence on the notion of what science should be and how economics mistakenly thought it could achieve that rationality and mechanistic thought. Mandeville's The Fable of the Bees, which Sedlacek sees as the first explicit expression of private vice leads to public good is next on the tour. Finally, the first 209 pages wraps up with a look at the "Adam Smith Problem" - how the popularly caricatured author of the "greed is good", "invisible hand" An Inquiry Into the Nature and Causes of the Wealth of Nations could write the earlier The Theory Of Moral Sentiments, a work he liked better that looks at how the natural, sympathetic bonds of man organize society.Along the way we not only get quotes from the relevant texts of the time but pop culture allusions to things like the Matrix movies, The Lord of the Rings, and P. J. Harvey. Each chapter ends with a concise summary of its arguments, and footnotes are mercifully put where they belong - at the foot of the page.The remainder of the book is a series of essays by Sedlacek and various authors - heretical thoughts which sometimes repeat themselves which is the book's biggest flaw. Keynes is looked at from two perspectives: his contribution of the idea of "animal spirits" - the spiritual and emotional factors that motivate human economic behavior - and a rehabilitation of the popular conservative notion of him as simply advocating government spending when he really advocated spending money that had actually been saved in "fat years". (Sedlacek sees this prefigured in the story of Jacob and the story of the seven lean and seven fat years.) Conservative economists who argue against central planning, he observes, still fall into the error committed by Karl Marx as seeing economics as central to civilization and the good life. And, while he argues that mathematics has its place in economics, his "Metamathematics" chapter shows that not everything economically important can be quantified, that just because it uses numbers doesn't make economics a science. Indeed, it seems to me, tying these thoughts in with another observation that economists are our modern priests purporting to tell us how to live to achieve the good life, their mathematical models often seem, broken and refuted by the real world, as so much self-delusion and self-aggrandizement.There is a bit of an attempt at policy solutions for getting us out of our current financial woes, specifically an appeal to Sabbath economics, zones of life outside of material acquisition, and a rethinking of the idea of economic growth as a be all and end all in itself.All in all, a rewarding read - though I'm sure I could have made more money doing something else with my time.